Friday, January 11, 2013

Gov't to review minimum wage for foreign workers

Following strong protests from the private sector, the cabinet has directed Human Resources Minister S Subramaniam to review the policy of allowing foreign workers to enjoy the same minimum wage as Malaysians, and come out with a new solution within this month.

 This was frontpaged by Chinese daily Oriental Daily News quoting anonymous sources. The daily reported that the inclusion of foreign workers in the minimum wage policy implemented on Jan 1 has brought huge and pervasive impacts to all industries. Hence, the cabinet, in its meeting yesterday, has discussed the problems prompted by the new policy and wanted the Human Resources Ministry to come out with a final solution before next month.

 According to Oriental Daily News, many small and medium companies are against the policy, claiming that it will affect the bonus, welfare and allowance of their employees. The Malaysian Knitting Manufacturers Association has pointed out that employers need to bear the extra expenses of some RM3,500 for every foreign worker, including levy, hostel fee, utilities fee, airfare, medical examination and insurance.

 The association claimed that the policy only benefits 10 percent of local workers while all foreign workers can enjoy it, resulting in the outflow of RM21 billion to their home countries. Many industrial associations and guilds demanded that the government allow them to incoporate those extra expenses into the minimum wage for foreign workers. The same view was shared by MCA president Dr Chua Soi Lek who said on Tuesday that the four MCA ministers will raise the suggestion to review the policy at the cabinet meeting. The party suggested transferring the cost of levy to foreign workers themselves, and include transportation, food and accommodation allowance into the minimum wage.

 It is said that foreign workers' salary will raise by RM200 to RM300 under the new policy, a burden to many employers. The Federation of Malaysian Foundry & Engineering Industries Association has informed its members to postpone the implementation of the new policy until the government comes out with the new decision. Small-Medium Industries (SMI) Association Malaysia president Teh Kee Sin told urged the government to hold a dialogue with the employers to clarify the allowances that can be included into the minimum wage. He told the daily that the association's members are confused as relevant government agencies have failed to provide a clear guideline on the new policy. “We hope the officers can sit down and discuss with the employers and clarify several details,” he was quoted as saying.

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